Student loan payment break extended for an additional 4 months

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Millions of student loan borrowers have just received four more months of relief, as the U.S. Department of Education said Friday it was extending the current forbearance until early next year.

The education ministry will now suspend payments, waive interest on student loans, and suspend collections for borrowers until Jan. 31, 2022. The ministry said the new “final end date” would allow borrowers to plan for the future. resumption of payments and reduce the risk of delinquency. and defaults after resumption of payments.

“As our country’s economy continues to recover from a deep hole, this latest extension will give students and borrowers the time they need to plan for the restart and ensure a smooth return to repayment,” said Education Secretary Miguel Cardona in a statement.

Relief for more than 40 million student loan borrowers was scheduled to expire on September 30. But a large majority of borrowers in two recent surveys said they weren’t ready to resume payments.

Consumer advocates had been pushing for an extension in recent weeks, warning of widespread confusion and an increase in missed payments. They said payments are not expected to resume until the Education Department releases a detailed plan to reactivate payments and help borrowers who may not be able to pay their payments.

This is the fourth time that the abstention period has been extended since it began in March 2020. The brief press release from the Ministry of Education announcing this latest extension calls January 31 the “last deadline” on three occasions.

The ministry says it will start advising borrowers of the new Jan.31, 2022 deadline in the coming days and will release information on how to plan for the restart. The news comes just days after further protection from a pandemic was extended when the Centers for Disease Control and Prevention renewed its moratorium on evictions.

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